New Delhi: On Friday, the benchmark indices have seen a dip with the budget announcement of long-term capital gains tax which has discouraged the investment sentiment.
Also, the bonds slid with the speculation that central bank would be targeting more towards controlling the inflation
According to the news reported in Business Standard, the government has announced a 10 percent tax on long-term capital gains in equity markets.
The weak sentiment is also result of the fact that the government proposed more spending for healthcare and rural sectors in its budget. It has the effect of widening the fiscal deficit target to 3.3% from the previous 3.0%.
At a time when the Consumer price Inflation is 5.21%, the government’s decision to increase the minimum support prices of crops can have the effect of increasing retail prices.